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BUSI 604 Test 2 (Set-1), Questions And Answers, Liberty University
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BUSI 604 Test 2 (Set-1), Questions And Answers, Liberty University
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BUSI 604 Test 2 falseQuestion 1
2 out of 2 points
The most important issue in understanding the effects of exchange
rates on business is its (________).
Selected Answer: Volatility
Question 2
2 out of 2 points
Many nations restrict hedging of their currencies due to their national
and international policies and interests.
Selected Answer: False
Question 3
2 out of 2 points
Since the world thrives to trade and does not have a uniformed
international currency, the exchange rate from one currency to
another is determined by (______) and (________) on a given day on
the FX Market.
Selected Answer: supply and demand
Question 4
,2 out of 2 points
A simpler way to calculate purchasing power parity between two
countries is to compare the price of a (________) good that is in fact
identical across countries.
Selected Answer: Standard
Question 5
2 out of 2 points
Purchasing Power Parity has an impact on exchange rates and
indicates the current level of inflation of one currency against
another.
Selected Answer: True
Question 6
2 out of 2 points
(________) and (_________) quotation are also referred to as
American and European Quotes.
Selected Answer: direct and indirect
Question 7
2 out of 2 points
The public begins to experience the effects of deflation with an
expanding money supply.
Selected Answer: False
Question 8
, 2 out of 2 points
Consumers attempt to offset inflation by exchanging (_________) for
something that is perceived to hold a value better such as property,
gold, or foreign currencies.
Selected Answer: lower-value currency
Question 9
0 out of 2 points
The economies of the world have become highly interdependent
because of improvements in communication and transportation
technologies and the lowering of barriers to trade.
Selected Answer: False
Question 10
0 out of 2 points
Forward rates are typically cheaper than spot rates.
Selected Answer: False
Question 11
2 out of 2 points
(_________) are used as an alternative to borrowing and lending in
the Eurodollar and other offshore markets.
Selected Answer: FX swaps
Question 12
2 out of 2 points
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